China resumes licensing for new games after 8-month halt
Published: Apr 11, 2022 11:14 PM
Internet games File Photo: VCG

File Photo: VCG

The National Press and Publication Administration (NPPA) announced on Monday the approval of licenses for 45 new game titles after more than eight months since game licensing was halted.

The NPPA announced on it official website the approval of Dreams Sailing's license, a game developed by Shenzhen-listed gaming firm 37 Interactive Entertainment, along with other 44 games which also received licenses on Friday, the administration's first approvals since July.

The NPPA's decision confirmed a report by the China Securities Journal published shortly before the announcement.

The news swiftly rallied investors around Chinese gaming shares traded on US exchanges in pre-market trading, with gaming giant NetEase and video platform Bilibili leading the pre-market gains.

On Monday, shares of 37 Interactive Entertainment finished up 3.66 percent, tremendously outperforming a 3.67 percent plunge in the Shenzhen Component Index.

The suspension of license approvals was seen as doubling down pressure on domestic gaming firms which have been grappling with internet regulatory toughening intended to improve legal compliance in the platform economy and foster more sustainable growth.

A typical example was the social networking and gaming behemoth Tencent. 

Tencent's revenues grew 8 percent year-on-year to 144.2 billion yuan ($22.63 billion) in Q4, the company's financial disclosures revealed in late March.

This was the internet giant's slowest quarterly revenue growth ever. For the whole of 2021, Tencent's revenues rose 16 percent, hitting 560.1 billion yuan ($87.9 billion), making it the year with the slowest yearly revenue growth. 

Revenues from online advertising fell 13 percent to 21.5 billion yuan ($3.38 billion) during Q4, an indication of "weakness in advertisement categories, including education, games and internet services," the company said.

Tencent's shares in Hong Kong trading plummeted 4.33 percent on Monday, bringing its year-to-date losses to 20.25 percent.